Edmond Carmona v. Domino's Pizza, LLC

FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

EDMOND CARMONA, No. 21-55009

Plaintiff-Appellee, D.C. No.

8:20-cv-01905-

and JVS-JDE

ABRAHAM MENDOZA; ROGER

NOGUERIA, on behalf of themselves OPINION

and all others similarly situated,

Plaintiffs,

v.

DOMINO’S PIZZA, LLC, a Michigan

Corporation,

Defendant-Appellant.

On Remand from the United States Supreme Court

Argued and Submitted June 20, 2023

Seattle, Washington

Filed July 21, 2023

2 CARMONA V. DOMINO’S PIZZA

Before: Kim McLane Wardlaw, Barrington D. Parker, Jr.,*

and Andrew D. Hurwitz, Circuit Judges.

Opinion by Judge Hurwitz

SUMMARY**

Federal Arbitration Act

On remand from the United States Supreme Court, the

panel affirmed the district court’s order denying Domino

Pizza’s motion to compel arbitration in a putative class

action brought by three Domino truck drivers, alleging

violations of California labor law.

The panel previously affirmed the district court’s denial

of Domino’s motion to compel arbitration, holding that

because the drivers were a “class of workers engaged in

foreign or interstate commerce,” their claims were exempt

from the Federal Arbitration Act by 9 U.S.C. § 1. The

Supreme Court granted certiorari, vacated, and remanded for

reconsideration in light of Southwest Airlines Co. v. Saxon,

142 S. Ct. 1783 (2022).

On remand, the panel stated that its prior decision

squarely rested upon its reading of Rittmann v. Amazon.com,

Inc., 971 F.3d 904 (9th Cir. 2020), which concerned Amazon

*

The Honorable Barrington D. Parker, Jr., United States Circuit Judge

for the U.S. Court of Appeals for the Second Circuit, sitting by

designation.

**

This summary constitutes no part of the opinion of the court. It has

been prepared by court staff for the convenience of the reader.

CARMONA V. DOMINO’S PIZZA 3

delivery drivers. The panel found no clear conflict between

Rittmann and Saxon and nothing in Saxon that undermined

the panel’s prior reasoning that because the plaintiff drivers

in this case, like the Amazon package delivery drivers in

Rittmann, transport interstate goods for the last leg to their

final destinations, they are engaged in interstate commerce

under § 1.

Rejecting Domino’s attempts to distinguish Rittmann,

the panel stressed that the issue was not how the purchasing

order was placed, but rather whether the plaintiff drivers

operate in a single, unbroken stream of interstate commerce

that renders interstate commerce a central part of their job

description. A pause in the journey of the goods at a

warehouse did not remove the goods from the stream of

interstate commerce because the goods were inevitably

destined from the outset of the interstate journey for

Domino’s franchisees.

COUNSEL

Norman M. Leon (argued), DLA Piper LLP US, Chicago,

Illinois; Steve L. Hernández, DLA Piper LLP US, Los

Angeles, California; Taylor Wemmer, DLA Piper LLP US,

San Diego, California; Courtney G. Saleski, DLA Piper LLP

US, Philadelphia, Pennsylvania; Jacob Frasch, DLA Piper

LLP US, Washington, D.C.; Gerson H. Smoger, Smoger &

Associates, Dallas, Texas; for Defendant-Appellant.

Aashish Y. Desai (argued) and Adrianne De Castro, Desai

Law Firm P.C., Costa Mesa, California, for Plaintiff-

Appellee.

4 CARMONA V. DOMINO’S PIZZA

Elizabeth B. Wydra, Brianna J. Gorod, and Smita Ghosh,

Constitutional Accountability Center, Washington, D.C., for

Amicus Curiae Constitutional Accountability Center.

Jeffrey R. White and Tad Thomas, American Association for

Justice, Washington, D.C.; Gerson H. Smoger, Smoger &

Associates, Dallas, Texas; for Amicus Curiae American

Association for Justice.

OPINION

HURWITZ, Circuit Judge:

This is a putative class action by three truck drivers

against their employer, Domino’s Pizza. We previously

affirmed the district court’s denial of Domino’s motion to

compel arbitration, holding that because the drivers were a

“class of workers engaged in foreign or interstate

commerce,” their claims were exempted from the Federal

Arbitration Act (“FAA”) by 9 U.S.C. § 1. Carmona v.

Domino’s Pizza, LLC, 21 F.4th 627, 628 (9th Cir. 2021).

The Supreme Court granted certiorari, vacated, and

remanded for reconsideration in light of Southwest Airlines

Co. v. Saxon, 142 S. Ct. 1783 (2022). Domino’s Pizza, LLC

v. Carmona, 143 S. Ct. 361 (2022). Upon reconsideration,

we again affirm.

I.

Domino’s sells ingredients used to make pizzas to its

franchisees. As relevant to this case, Domino’s buys those

ingredients from suppliers outside of California, and they are

then delivered to Domino’s Southern California Supply

Chain Center. At the Supply Center, Domino’s employees

CARMONA V. DOMINO’S PIZZA 5

reapportion, weigh, and package the relevant ingredients for

delivery to local franchisees but do not otherwise alter them.

The plaintiff drivers (“D&S drivers”), employees of

Domino’s, then deliver the ingredients in response to orders

from Domino’s California franchisees.

Three D&S drivers filed this putative class action against

Domino’s in 2020, alleging various violations of California

labor law. Each plaintiff’s agreement with Domino’s

requires arbitration of “any claim, dispute, and/or

controversy” between them. But the district court denied

Domino’s motion to compel arbitration, finding the

plaintiffs exempt from the FAA under 9 U.S.C. § 1 as

members of a class of transportation workers “engaged in

foreign or interstate commerce.” We affirmed, concluding

that these last-leg truck drivers were “engaged in a single,

unbroken stream of interstate commerce.” Carmona, 21

F.4th at 629–30 (cleaned up).

II.

In Saxon, the Supreme Court considered whether § 1

exempted from the FAA “workers who physically load and

unload cargo on and off airplanes.” 142 S. Ct. at 1789. In

finding these workers exempt, the Court focused on the

“class of workers” at issue, an inquiry which emphasized not

the employer’s business but rather “the actual work that the

members of the class . . . typically carry out” in that business.

Id. at 1788. An employee whose typical duties were to clean

a local office, for example, would not be a member of an

exempt class simply because his employer was itself

engaged in interstate commerce. Id. at 1792. But the Court

held that an employee who “frequently loads and unloads

cargo on and off airplanes that travel in interstate commerce”

was engaged in interstate commerce. Id. at 1793. The Court

6 CARMONA V. DOMINO’S PIZZA

held that, in assessing whether workers are engaged in

interstate commerce, the critical question is whether the

workers are actively “engaged in transportation” of goods in

interstate commerce and play a “direct and necessary role in

the free flow of goods across borders.” Id. at 1790 (cleaned

up). In finding that the cargo workers met this description,

the Court specifically rejected Southwest’s argument that the

cargo workers must themselves cross state lines to be

engaged in interstate commerce. Id. at 1791.

Saxon did not address the question now before us.

Rather, the Court expressly pretermitted whether “last leg”

drivers like the D&S drivers in this case qualified for the

exemption, stating:

We recognize that the answer will not always

be so plain when the class of workers carries

out duties further removed from the channels

of interstate commerce or the actual crossing

of borders. Compare, e.g., Rittmann v.

Amazon.com, Inc., 971 F.3d 904, 915 (C.A.9

2020) (holding that a class of “last leg”

delivery drivers falls within § 1’s exemption),

with, e.g., Wallace v. Grubhub Holdings,

Inc., 970 F.3d 798, 803 (C.A.7 2020)

(holding that food delivery drivers do not). In

any event, we need not address those

questions to resolve this case.

Id. at 1789 n.2.

III.

The Supreme Court remanded “for further consideration

in light of [Saxon].” Carmona, 143 S. Ct. at 361. Our prior

CARMONA V. DOMINO’S PIZZA 7

decision squarely rested upon our reading of Rittmann v.

Amazon.com, Inc., 971 F.3d 904 (9th Cir. 2020), a case

whose continued validity Saxon expressly declined to

address. Saxon, 142 S. Ct. at 1789 n.2. Unless Rittmann is

somehow “clearly irreconcilable” with Saxon, we are

required to continue to follow it.1 Miller v. Gammie, 335

F.3d 889, 899–900 (9th Cir. 2003) (en banc). We find no

clear conflict between Rittmann and Saxon.

Rittmann confronted whether delivery drivers who

transported goods from Amazon warehouses to in-state

consumers were exempt from the FAA under § 1. 971 F.3d

at 915. After first analyzing the business of “the company

for whom the delivery person works,” id. at 917, we turned

to what Saxon later confirmed is the central inquiry: what the

relevant class of workers actually did, id. at 915 (“AmFlex

workers pick up packages that have been distributed to

Amazon warehouses, certainly across state lines, and

transport them for the last leg of the shipment to their

destination.”). And we concluded that, because the Amazon

goods shipped in interstate commerce were not transformed

or altered at the warehouses, the entire journey represented

one continuous stream of commerce. Id. at 915–17.

Our prior opinion held that the FAA exempted the claims

in this case because the D&S drivers were part of a “class of

workers engaged in foreign or interstate commerce,” 9

U.S.C. § 1; Carmona, 21 F.4th at 628. Although we noted

that the “nature of the business for which a class of workers

performed their activities” was a “critical factor” in the § 1

analysis, id. at 629 (cleaned up), we in the end focused

1

Although we recognize that the Fifth Circuit disagrees with Rittmann,

see Lopez v. Cintas Corp., 47 F.4th 428, 432–34 (5th Cir. 2022), we are

bound by it.

8 CARMONA V. DOMINO’S PIZZA

heavily on what the class of workers to which the plaintiffs

belonged actually did. Relying on Rittmann, we stressed that

because “the D&S drivers, like the Amazon package

delivery drivers, transport [interstate] goods for the last leg

to their final destinations,” they are engaged in interstate

commerce under § 1. Id. at 630 (cleaned up). Nothing in

Saxon undermines that reasoning.

Our prior opinion also squarely rejected Domino’s

attempts to distinguish Rittmann. Id. We find them no more

persuasive the second time around. Domino’s primarily

argues that Rittmann does not control because, unlike

Amazon customers, Domino’s franchisees do not order the

goods until after they arrive at the warehouse. But we

previously stressed that “[t]he issue is not how the

purchasing order is placed, but rather whether the D&S

drivers operate in a single, unbroken stream of interstate

commerce that renders interstate commerce a central part of

their job description.” Id. (cleaned up). Indeed, the Supreme

Court has long rejected the notion that the timing of an order

is itself dispositive of whether goods remain in the stream of

interstate commerce. See Walling v. Jacksonville Paper Co.,

317 U.S. 564, 570 (1943) (“We do not mean to imply that a

wholesaler’s course of business based on anticipation of

needs of specific customers, rather than on prior orders or

contracts, might not at times be sufficient to establish that

practical continuity in transit necessary to keep a movement

of goods ‘in commerce’ . . . .”).

Nor does the pause in the journey of the goods at the

warehouse alone remove them from the stream of interstate

commerce. See id. at 568 (“The entry of the goods into the

warehouse interrupts but does not necessarily terminate their

interstate journey.”); id. (“[I]f the halt in the movement of

goods is a convenient intermediate step in the process of

CARMONA V. DOMINO’S PIZZA 9

getting them to their final destinations, they remain ‘in

commerce’ until they reach those points.”); see also Fraga

v. Premium Retail Servs., Inc., 61 F.4th 228, 241 (1st Cir.

2023) (holding that an employer’s “use of its own employees

to carry the materials for the last part of each interstate

journey does not turn the journey into two unconnected

trips”). Because the goods in this case were inevitably

destined from the outset of the interstate journey for

Domino’s franchisees, it matters not that they briefly paused

that journey at the Supply Center.

Citing A.L.A. Schechter Poultry Corp. v. United States,

295 U.S. 495 (1935), Domino’s also argues that the interstate

journey ended at the Supply Center because the goods were

repackaged there. But in contrast to Schechter, which

involved chickens slaughtered at the poultry company and

only then delivered to local buyers, id. at 520–21, the

relevant ingredients in this case are unaltered from the time

they arrive in the Supply Center until they are delivered to

franchisees. Immediato v. Postmates, Inc., 54 F.4th 67 (1st

Cir. 2022), upon which Domino’s also relies, is similarly

inapposite: the products delivered in that case were

transformed from their constituent ingredients into meals

before the plaintiff drivers delivered them. Id. at 78.

IV.

We conclude that Saxon is not inconsistent, let alone

clearly irreconcilable, with Rittmann, which continues to

control our analysis. We therefore AFFIRM the order of the

district court.